Option for Regular Savings

You're missing that there is a deemed disposal 8 years after the first year:
  1. no tax
  2. no tax
  3. no tax
  4. no tax
  5. no tax
  6. no tax
  7. no tax
  8. no tax
  9. deemed disposal
  10. actual disposal
 
Corola said:
You're missing that there is a deemed disposal 8 years after the first year:
  1. no tax
  2. no tax
  3. no tax
  4. no tax
  5. no tax
  6. no tax
  7. no tax
  8. no tax
  9. deemed disposal
  10. actual disposal
Click to expand...
Shouldn't it be

8. Deemed disposal

since that's its 8th "birthday"?
 
If you change it to calendar year starting the monthly investments on 1st Jan 2001 for ten years, the eighth birthday is in 2009:

2001 no tax
2002 no tax
2003 no tax
2004 no tax
2005 no tax
2006 no tax
2007 no tax
2008 no tax
2009 deemed disposal
2010 actual disposal
 
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Corola said:
If you change it to calendar year starting the monthly investments on 1st Jan 2001 for ten years, the eight birthday is in 2009:

2001 no tax
2002 no tax
2003 no tax
2004 no tax
2005 no tax
2006 no tax
2007 no tax
2008 no tax
2009 deemed disposal
2010 actual disposal
Click to expand...
Actual disposal would be in 2011 on that case.
 
I'm assuming ten calendar years lasting from 1st Jan to 31st Dec. The important thing is to include the 8 year anniversaries before the end point.
 
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Corola said:
I'm assuming ten calendar years lasting from 1st Jan to 31st Dec. The important thing is to include the 8 year anniversaries before the end point.
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If the 8th anniversary falls in any part of a tax year, the tax is due for that tax year. For example:

Deemed Disposal Timeline​

Investment Date8-Year AnniversaryTax YearTax Filing Deadline
January 1, 2001January 1, 20092009October 31, 2010
February 1, 2001February 1, 20092009October 31, 2010
............
December 1, 2010December 1, 20182018October 31, 2019

 
Yes, if you were holding the investment indefinitely.

But if you want to know how much the investment is worth at a point in time you need to pick the same valuation point for all the investments, not the tax filing deadline. I have chosen 31st December 2010, the end of the tenth year, because your scenario is €650 a month for 10 years.

You have to simulate paying all the remaining tax on that date to know the final net amount.

It is the same valuation point in your scenario, the tax is realised after 120 months:
ChatGPT and Co Pilot verifies it is correct,
  • Calculate the Gross Final Value:
    • Monthly contributions of €650 with a 6% annual rate (0.5% monthly) over 120 months.
    • Using the future value of an annuity formula for monthly compounding, this should yield around €107,600 before taxes.
  • Calculate the Total Contributions:
    • €650 x 120 months = €78,000.
  • Calculate the Gain and Apply the Tax:
    • Gross profit = €107,600 - €78,000 = €29,600.
    • Tax on the profit: €29,600 x 41% ≈ €12,136.
  • Calculate the Net Amount:
    • Final net amount = Gross final value - Tax on profit = €107,600 - €12,136 ≈ €95,464.
Click to expand...
 
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dodo said:
I have E620 after tax a month from a widows pension .I want to put away so I can gift to my daughters in eg in 10 years.
I have my work pension maxed out via AVC.
Revolute have Regular Savings at 3.49%.
APR.
Is there anything else worth looking into,no risk investment.
Age 53
Click to expand...
It may or may not be applicable here but factor in your tax situation for inheritance also. If you are near or exceed the inheritance thresholds with the estate you will leave your children it may make sense to open the stock accounts in your daughter's names now and put up to €3,000 (annual gift exemption) into each account on an annual basis, rather than transfer a lump sum in ten years time.
 
Persius said:
Given all the fraud stories, I would be very reluctant to put so much money in Revolut.
There are other options, such as de Giro and Trade Republic.
Trade Republic are giving 3.5% interest on money held on deposit up to 50k. And you can set up a monthly payment into an S&P 500 ETF.
If going the ETF route, pick the accumulating (ACC) option. Don't pick the distributing (DIST) option. Distribution means it pays you the dividends every year and you have to pay 41% tax each year on that. Better to leave the dividends to accumulate in the EFT, where they should continue to grow. Then you just have to pay the tax at the end of the eighth year.
Click to expand...
what etf do you feel is the best accumulating one?
 
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